And the Award Goes toâ€¦Women-Owned Businesses!
Women-owned businesses can now count another victory as the federal government has reached its goal of awarding five percent of the money spent on contractors to businesses owned by women. The government defines a women-owned businesses as those that are at least 51 percent controlled by women. In 1994, the federal government set a goal of awarding five percent of the money it spent on contractors to businesses owned by women (www.nytimes.com). Twenty-two years later, the federal government has for the first time finally met its goal.
According to the Small Business Administration (SBA), small businesses earned nearly 29 percent or $90.7 billion of the government’s contracting dollars during the 2015 fiscal year, which ended on September 30th, 2015. Out of that $90.7 billion earned by small businesses, women-owned businesses captured nearly $18 billion of those dollars. The government set this goal as companies owned by women tend to be younger and smaller than other businesses. Although women-owned businesses may be young and fewer in number, analysis by the department of commerce shows that women-owned business are indeed 21 percent less likely to be awarded government contracts than small businesses that are not women-owned.
The infographic below explains the growth and importance of women-owned businesses in America:
This goal was achieved mostly as a result of rules that were implemented by the government five years ago in 2011, which mandated that agencies set aside specific contracts allowing bids from only women-owned businesses as well as rules making them eligible for no-bid contractsâ€”ultimately permitting women-owned businesses to not only gain experience, but to also provide them with the past performance necessary to win other competitive projects. Another reason why the government was able to meet its goal can be attributed to the Small Business Administration, which increased its outreach efforts over the past several years to teach women entrepreneurs about federal procurement opportunitiesâ€”guiding them through the often complex process of preparing bids. Maria Contreras-Sweet, the 24th Administrator of the Small Business Administration, also made the recent achievement a top priority.
While five percent may seem like a small number, it is a significant achievement for women in the federal marketplace who have long been underrepresented. With this milestone, Washington has shown all Americans that if the government is determined enough, it can produce positive and impactful outcomes.